New Delhi: The Reserve Bank of India’s (RBI) upcoming Monetary Policy Committee (MPC) meeting, scheduled from September 29 to October 1, is expected to maintain the current policy stance, with a low probability of a rate cut, experts said on Sunday.
Experts noted that the MPC meeting comes against a backdrop of ongoing global tariff tensions and concerns over the fiscal health of advanced economies.
“The Indian economy has shown strong resilience, achieving a five-quarter high growth in the first quarter of 2025-26, driven largely by domestic consumption and other local factors,” they said.
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The experts added that, while uncertainties remain regarding global growth, recent domestic data suggest limited downside risks.
However, experts cautioned that a lower tax collection could lead to reduced government capital expenditure, which might offset some of the positive growth impact from the GST rate cuts boosting consumption.
The market is closely watching the MPC after the August meeting, when the central bank kept the repo rate at 5.50 per cent and maintained a neutral stance.
The decision followed a period of three rate cuts earlier in the year, including a 50-basis-point “jumbo” cut in June, alongside a 100-basis-point reduction in the Cash Reserve Ratio (CRR) to boost liquidity.
Analysts expect the MPC to maintain the status quo in October, allowing time for the full impact of the CRR cut and any further fiscal measures to unfold.
The decision will also consider global factors, including the US Federal Reserve’s likely rate cuts and ongoing trade tensions, which could affect interest rate differentials and foreign demand for Indian debt.
Overall, the baseline view points to a prolonged pause in policy rates, with only a small chance of a residual cut in the December MPC meeting, depending on forward-looking inflation and growth trends.
The RBI will announce its decision on October 1, followed by a press conference by Governor Sanjay Malhotra, livestreamed on the central bank’s YouTube channel and social media platforms.
